NEXTNRG, INC. Income Taxes Disclosure

Note 13 – Income Taxes

 

The components of the deferred tax assets and liabilities at December 31, 2025 and 2024 were approximately as follows:

 Schedule of Deferred Tax Assets and Liabilities

		December 31, 2025				December 31, 2024
Deferred Tax Assets
Stock based compensation		$	11,142,537			$	346,000
Intangibles			1,660,542				907,000
Net operating loss carryforward			-				13,460,000
Lease liabilities			154,219				43,000
Capitalized research expenditures			367,225				367,000
Impairment loss			(2,163,832	)			-
Bad debt reserve			41,936				31,000
Other			9,042				9,000
Total deferred tax assets			11,211,669				15,163,000
Deferred Tax Liabilities
Depreciation			(218,692	)			(442,000	)
Prepaid assets			(64,098	)			(92,000	)
Right-of-Use asset			(16,377	)			(128,000	)
Total deferred tax liabilities			(299,167	)			(662,000	)
Deferred Tax Assets			10,912,502				14,501,000
Less: valuation allowance			(10,912,502	)			(14,501,000	)
Deferred tax asset - net		$	-			$	-

 

The components of the income tax benefit and related valuation allowance for the years ended December 31, 2025 and 2024 were as follows:

 Schedule of Income Tax Benefit and Related Valuation Allowance

		December 31, 2025				December 31, 2024
Current		$	-			$	-
Deferred			(3,588,498	)			(3,193,000	)
Total income tax provision (benefit)			(3,588,498	)			(3,193,000	)
Less: valuation allowance			3,588,498				3,193,000
Total Tax Provision		$	-			$	-

 

A reconciliation of the provision for income taxes for the years ended December 31, 2025 and 2024 as compared to statutory rates is as follows:

 Schedule of Reconciliation of Provision for Income Taxes

		December 31, 2025				December 31, 2024
Federal income tax expense (benefit) - 21%		$	(18,516,959	)		$	(3,400,000	)
State income tax expense (benefit) - 4.35% - net of federal effect			(3,835,656	)			(704,000	)
Permanent differences - net			3,161,663				911,000
Deferred adjustments			-				-
Change in valuation allowance			(3,588,498	)			3,193,000
Income tax expense (benefit)		$	(22,779,452	)		$	-

 

Federal net operating loss carry forwards at December 31, 2025 and 2024 were approximately as follows:

 Schedule of Operating Loss Carry Forwards

		December 31, 2025				December 31, 2024
		$	148,000,000			$	59,000,000

  

The Company reviews its filing positions for all open tax years in all U.S. Federal and State jurisdictions where the Company is required to file. The tax years subject to examination include the years 2021 and forward.

 

There are no uncertain tax positions that would require recognition in the consolidated financial statements. If the Company incurs an income tax liability in the future, interest on any income tax liability would be reported as interest expense and penalties on any income tax liability would be reported as income taxes. The Company’s conclusions regarding uncertain tax positions may be subject to review and adjustment at a later date based upon ongoing analyses of tax laws, regulations and interpretations thereof as well as other factors.